Key takeaways

  • Binance's Financial Crime Compliance and Investigations team worked with the Netherlands Fiscal Information and Investigation to freeze several million euros involved in an exit scam on a major platform games of chance.

  • The company's compliance procedures, money laundering detection tools and analytics capabilities were instrumental in detecting suspicious activity and helping law enforcement track down the suspect.

  • Last year, Binance's dedicated teams responded to more than 58,000 law enforcement requests and conducted approximately 120 training sessions to share their expertise with law enforcement entities around the world, thus proving its commitment to strengthening the security of the Web3 ecosystem.

Binance’s number one commitment is to protect users and exclude bad actors from the digital asset ecosystem. As part of this mission, Binance's Financial Crime Compliance (CCF) and Investigations team recently assisted the Fiscal Information and Investigation Service (FIOD), the Dutch government agency responsible for investigating financial crimes, to freeze several million euros stolen as part of an exit scam organized on a large gaming platform.

No recovery possible

As announced by the FIOD, a suspect was arrested on April 29 on suspicion of fraud, embezzlement and money laundering as part of an investigation into a large-scale scam on the so-called ZKasino gambling platform. As the report details, “ZKcasino presented itself as a gambling platform and casino on the blockchain. Investors were led to believe that they would get their investments back within 30 days. » However, a subsequent examination of the technique of implementing the smart contract on the blockchain suggested that such recovery “was not intended. »

It was the community that first raised the alarm about this alleged scam. Members of Binance's CCF and investigations team then proactively researched the matter, collecting and verifying available information from open sources. Subsequently, the team put law enforcement on the trail of the suspect, an individual with a Binance account, and provided the transaction tracking information authorities needed to get a more accurate picture of the situation.

Binance’s procedures and compliance checks played a key role in stopping the suspect who attempted to abuse the platform. Our money laundering detection and analysis tools and expertise enabled our investigations and sanctions team to detect suspicious activity, which triggered an in-depth review of Binance's potential exposure and risks associated with the accounts involved. The blockchain analysis tool provided by one of our industry partners was used to assign the addresses to ZKasino. Binance then passed the information collected to law enforcement to advance the investigation into the exit scam, and helped freeze the ill-gotten funds.

This investigation is still ongoing, and the FIOD does not rule out the possibility of other arrests. 

A working group at the forefront of the sector

Binance admits that as an industry leader, it bears the immense responsibility of protecting the global crypto ecosystem and its users from malicious actors. We have established the most trusted investigative group in the industry to ensure the protection of users and investors. 

Our compliance and investigations experts continue to work closely with law enforcement and regulatory authorities around the world to help Binance stay at the forefront of the fight against financial cybercrime globally, a hard work that pays off when criminals seeking to abuse the crypto ecosystem are incapacitated and stolen funds are frozen or seized.

In another example of successful collaboration with law enforcement, Binance recently helped Indian authorities dismantle a fraudulent investment network posing as a gaming platform, and its assistance also resulted in the recovery of several million dollars in assets.

Overall, Binance has been instrumental in combating various serious security threats and major crimes, including terrorist financing, distribution of child pornography, nation-state hacking, intellectual property theft, drug smuggling and fake investments. Last year, Binance's dedicated teams responded to more than 58,000 law enforcement requests within an average of three days, faster than any traditional financial institution. These teams have also conducted approximately 120 training sessions to share their expertise with law enforcement agencies around the world.